Silver prices surged on the Multi Commodity Exchange (MCX) on February 18, with the continuous contract trading at Rs 2,33,355 per kg, up Rs 4,572 or 2.00% as of 09:07 AM.
The rebound in domestic prices comes in line with gains in international markets, where silver rose to around $74 per ounce, pausing after two consecutive sessions of decline. The uptick is largely attributed to dip-buying interest and positioning ahead of the U.S. Federal Reserve’s January meeting minutes.
Fed outlook in focus
Markets continue to price in multiple rate cuts later this year, a backdrop generally considered supportive for non-yielding assets such as silver. Although recent commentary has suggested that interest rates may remain on hold in the near term, investors are factoring in the possibility of cuts later in the year if inflation trends closer to the Federal Reserve’s 2% target.
Traders are closely monitoring further remarks from Fed officials as well as key U.S. economic data, including GDP and core PCE inflation figures, for clearer signals on the monetary policy trajectory.
Dollar and geopolitical cues
Earlier strength in the U.S. dollar and easing geopolitical tensions had weighed on safe-haven demand, contributing to the recent pullback in prices. However, subdued trading volumes due to Lunar New Year holidays across parts of Asia also limited downside pressure, allowing silver to stabilise and rebound.
The current move on MCX reflects a combination of global price recovery and expectations surrounding the Fed’s policy direction.